Seth Davis
Seth Davis values relationships. Whether he’s working on behalf of his clients or volunteering in his community, his approach reflects compassion, dignity, and respect for others. He sees customer service as paramount for businesses and knows that financial institutions must build long-lasting partnerships with borrowers and investors, where everyone wins.
Seth has over 25 years of experience in the banking industry and across all areas of real estate. He’s a licensed mortgage banker and Arizona-licensed real estate broker, with expertise across senior, mezzanine, and equity positions in the capital stack. Leveraging his successful record of starting and growing a structured finance group, Seth left a remarkable career at Western Alliance Bank to join Arixa Capital’s leadership team as a managing director. “I’ve known the founders for years, and I share their core value of treating borrowers with white glove service. In my prior role as a financing partner to Arixa, I developed a long-term relationship with the founders that was based on the same philosophy of service, so we knew we shared similar values,” he says. While Seth manages the company’s institutional fund and originates loans for multifamily residential and commercial real estate properties, he’s also heading up Arixa’s Arizona office. The Arizona team is expanding to serve growing demand in the Phoenix real estate market, amid the surge of new developments and revitalization projects to remedy the “functionally obsolete” housing from earlier decades. As a 20-year resident of Phoenix, Seth is more than a banking leader, he’s part of the community he serves. “My family has deep roots here. My spouse and children were born and raised here, and I’ve called this city my home for decades. It’s a community we’re very involved in,” he says.
Founded in 2006, Arixa provides small-balance loan solutions to residential and commercial developers who revitalize properties, striving to offer investors consistent income while seeking to limit risk. Serving the lower and middle markets throughout the Western U.S., Arixa has issued approximately $1B in loans in 2022, with about 70% of those to existing customers. They achieve that level of repeat business because they prioritize the borrower’s experience, striving to create long-term relationships. The company is employee owned, with many of its executives and employees investing in the funds, so the Arixa team has a personal stake in their borrowers’ success. This has the added benefit of offering Arixa’s employees a unique perspective to understand a transaction from the side of both investor and borrower. With all this, it should come as no surprise that Arixa Capital was named one of the Fastest Growing Private Companies in Los Angeles in 2021 and 2022 by Los Angeles Business Journal.
We sat down with Seth to hear more about what drew him to Arixa, what makes them unique, and why he takes his work so personally.
Q: What brought you to Arixa from a successful career with publicly traded banks?
I came here because the founders and I share the same values—customer service first. While I could have continued to enjoy a successful tenure in my banking career, the opportunity to grow at Arixa, and be an integral part of its success, really excited me. I joined to expand the platform with institutional investors and to build a presence in Phoenix. We’re not just lending. We’re growing the company and providing jobs as a part of the community here. That’s important to me.
Q: How is Arixa different from other private real estate lenders?
What we think really differentiates us is how we essentially act as a private client bank with best-in-class service to real estate developers. We’re there for every step of the lending life cycle. We originate and service the loans, process the construction draws, and handle every touch point with customers to ensure their experience is top notch. As a privately owned real estate lender, we are able to make quick decisions and provide certainty of execution. This has led to high client satisfaction, where over 70% of our business comes from repeat clients.
Additionally, our focus on single family and multifamily housing addresses a critical niche in the systemic housing shortage. The 2008 financial crisis reduced the number of institutions willing to issue loans under $10M, limiting the financing options for developers. Our focus on originating loans between $1M to $15M fills this gap for developers while also helping to alleviate the lack of supply in housing.
Q: The Arixa team is unique in that you all have experience and insight as both banking and finance experts and as investors yourselves. How does this dual lens from “both sides” benefit your clients?
That concept is at the core of our company culture. We have been real estate investors and borrowers of other lenders, so we understand what it’s like dealing with lenders and what it’s like to not receive the service levels you expect. This experience gives us a much greater understanding and empathy for our borrowers and we really strive to provide the best experience possible.
We also invest in our funds alongside our investors. We think this is important and tell our staff, “Act like your grandmother’s money is in the fund.” Preserving the Arixa track record is what drives our behavior as fund managers. So, while we have an intense focus on ensuring our borrowers have a best-in-class experience, it is just as important, if not more so, that the investors in our funds are treated with fiduciary care. It’s like this: imagine a stool with three legs. If one leg breaks, the whole stool falls over. Our investors, borrowers, and employees are the legs of the stool, and our culture is focused on acting in the best interest of all three stakeholders.
Seth Davis
Managing Director — Arixa Capital